The Auditor Has a Responsibility to Review Transactions and Activities

question 39

Multiple Choice

The auditor has a responsibility to review transactions and activities occurring after the balance sheet date to determine whether anything occurred that might affect the valuation or disclosure of the statements being audited.The auditing procedures required to verify these transactions are commonly referred to as the review for:

• A) late unusual occurrences.
• B) subsequent events.
• C) contingent liabilities.
• D) subsequent years' transactions.

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Definitions:

Unauthorized Act

An action that is taken without official permission, approval, or authority.

Criminal Liability

The legal responsibility a person or entity has for committing an act that is considered a crime by law.

Employer

An individual or organization that hires and pays people to perform work or provide services.

Third Restatement

A reference in U.S. legal doctrine, particularly in the context of tort law, to the latest revision of a comprehensive guide on legal principles.